A Price Reduction Won’t Save Your Business

The survey by womo.com.au asked respondents to prioritise influential factors that influence them to go back to a business. Surveys were done in three business categories: personal care (e.g. hairdressers, beauticians and massage therapists), food service and tradespeople.

The results showed a shift from the previous generation of bargain hunters to a generation who is more concerned with a premium quality of service and higher product value. In the category of personal care, Australians are more likely to choose vanity over price.

87% agreed that high expertise and quality services were ‘very important’ influential factors influencing them to return to a business.81% rated that attentive and courteous staff was also very important.40% rated location as an important factor.33% rated fast service as very important.35% rated low prices, discounts and promotions as very important.

Participants were also asked about factors leading them to return to a business after bad service:47% rated significant compensation20% rated new management18% rated small gift or apology11% rated feedback from other customers2% rated promotions and sales

The most surprising result was, however, on the importance of freebies and sample products. 46 per cent of participants voted free samples as the least important factor in influencing them to return to a business.

Fiona Adler, founder of womo.com.au, advises small and medium businesses to stop wasting resources and start listening to their customers.
“It’s apparent that the consumer-business relationship is changing,” she said, “people consider a high-quality product first, and consider cost a lesser priority.”

What should businesses do? According to Fiona, businesses need to invest in staff training and use premium materials over cheap gimmicks or promotions. “Consumers are also more vocal now than ever before, they tell businesses how they feel online,” said Fiona, “by tapping into this feedback, businesses should be able to create a successful model to build a more loyal customer base.”